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Does this VCT suit your client?

For professional advisers and paraplanners only. Not to be relied upon by retail clients.

If you’re thinking of recommending a venture capital trust (VCT), you want to be sure it’s right for your client in two senses.

First, and most obviously, a VCT needs to be right for the client. That will depend, among other things, on their circumstances, their goals and their attitude to risk.

Octopus has a guide called ‘Identifying clients who could benefit from VCTs’, which can help you spot when a client may benefit from this type of investment.

Second, the VCT itself should be one that resonates with your client.

For some clients, that may mean a VCT that invests in companies towards the more mature end of the VCT spectrum.

Octopus Apollo VCT, which is open for investment, does just that.

Advisers find that this type of VCT is often a better fit. Some clients are more comfortable with underlying companies that have a few years trading under their belt.

Apollo’s portfolio is made up of companies that:

  • Have already brought a product or service to market successfully, with a growing and diversified customer base.
  • Typically sell to other businesses, and have contracts with them that generate predictable, recurring revenues.

Apollo also makes both debt and equity investments, giving it a different risk-return profile to other VCTs.

To be clear, these are still young companies. Some won’t be making a profit yet. The idea is to accelerate their growth to the point where they are.

As such, Apollo remains a high-risk investment, as all VCTs should be.

What makes Apollo different from some other VCTs is the focus on companies that have already cleared some of the hurdles on their journey. There are no start-ups.

So if you have clients who you think may benefit from this flavour of VCT investment– come along to the Octopus webinar on Tuesday 3 September at 11am.

Register for the webinar HERE.

Key VCT risks:

  • The value of a VCT investment, and any income from it, can fall as well as rise. Investors may not get back the full amount they invest.
  • Tax treatment depends on individual circumstances and may change in the future.
  • Tax reliefs depend on the VCT maintaining its VCT-qualifying status.
  • VCT shares are by their nature high risk, their share price may be volatile and they may be hard to sell.

VCTs are not suitable for everyone. Any recommendation should be based on a holistic review of your client’s financial situation, objectives and needs. We do not offer investment or tax advice. This advertisement is not a prospectus. Investors should only subscribe for shares based on information in the prospectus and Key Information Document (KID), which can be obtained from octopusinvestments.com. Issued by Octopus Investments Limited, which is authorised and regulated by the Financial Conduct Authority. Registered office: 33 Holborn, London, EC1N 2HT. Registered in England and Wales No. 03942880. Issued: August 2019. CAM008620-1908

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